Product Market Analysis & Strategy

By Megan SongApril 30, 2016

Overview

Market Overview

Need Statement

Current Solutions

Competitors

Big Idea

Marketing Strategy

Market Context

Market for BrainCo - Global Digital Brain Health Market

• Web-based, mobileand biometrics-based technology

• Assess, monitorand enhancecognition and brainfunctioning.

Market Context

In 2020, The market is forecasted to reach $6 billion

Source: The Digital Brain Health Market report 2012-2020 by SharpBrain http://sharpbrains.com/market-report/

Market Context

Source: The Digital Brain Health Market report 2012-2020 by SharpBrainhttp://sharpbrains.com/market-report/

Strong Positive Response for the Brain Health

Market for Product

As the first product of BrainCo, our product needs

to find a market with clear and strong need,

and accessibility to enter

The ADD/ADHD market is huge, profitable andeager for a solution.

The ADD/ADHD Market

Market for Product - Children

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Source: 1. Attention Deficit Hyperactivity Disorder Among Children Aged 5–17 Years in the United States, 1998–2009, L. Akinbami, X. Liu. NCHS Data Brief No. 70, August 2011. http://www.cdc.gov/nchs/data/databriefs/db70.pdf2. Child Population: number of children ages 0-17 in the united states by age, 1950-2014 and projected 2015-2050. http://www.childstats.gov/americaschildren/tables/pop1.asp

By 2018, the population of children aging 5-17 diagnosed with ADD/ADHD is estimated to be 6.7 million

Market for Product - Children

An increasing percentage of children aged 5-17 years from families with an income less than 200% of poverty level will be diagnosed with ADHD.

02468

10121416

Percentage of children aged 5-17 years ever diagnosed with ADHD, by poverty status: United States

Less than 100% of povertylevel

100-199% of poverty level

more than 200% ofpoverty level

Source: CDC/NCHS, Health Data Interactive and National Health Interview Survey. Prediction: R square (less than 100%) is 0.987, R square (100-199%) is 0.899, R square (more than 200%) is 0.899.

Market for Product - Children

Insight

• The population of children aged 5-17 diagnosed with ADD/ADHD will keep increasing

• Most of them are from families with an income less than 200% of poverty level, which is expected to be $50,794.9 for a family of 3 and $60,118.95 for a family of 4 in theyear 2018

• Parameter: Expense for Neurofeedback training is estimated to be $12,000 in average.

Conclusion: The ADHD patients from lower-to-middle income families are increasing, whereas they cannot afford neurofeedback training.

Market for Product - Adult

4.4% of 18+ years old adults has ADHD, 1 expected to be a

population of 9.8 million2.

Only 25% of adults diagnosed with ADHD seek medical help.3

Source:1. http://www.adhdawarenessmonth.org/wp-content/uploads/ADHD-in-the-US-Population-FINAL-English13.pdf 2. http://datacenter.kidscount.org/data/tables/99-total-population-by-child-and-adult#detailed/1/any/false/869,36,868,867,133/39,40,41/416,417 3. http://www.adaa.org/understanding-anxiety/related-illnesses/other-related-conditions/adult-adhd

41.3% of these cases are classified as severe and would be

eligible for therapeutic intervention

Market for Product - Adult

Great lost due to ADHD

• Adults incurred $105 billion–$194 billion (73%–74%) of the overall excess cost of ADHD.

• The primary costs of adult ADHD are loss of income and loss of productivity at work.

• Household income is $10,532 to $12,189 less per person per year ($90.04 billion–$104.20 billion total)

• Many patients complain that ADHD has made themforget important dates and things, and contributes toquarrels and divorces.

Source: http://www.chadd.org/Understanding-ADHD/About-ADHD/Data-and-Statistics/Cost-of-ADHD.aspx#sthash.5ZyOX3Kp.dpuf

Market for Product - Adult

Insight

• Adults diagnosed with ADHD seldom seek help

• Possible factors contributing to the phenomenonmight be time, convenience and disposable income.

• Great lost has occurred due to ADHD for adults,including income and relationships.

Conclusion: Adult patients need a solution that is effective,

affordable and convenient.

Need Statement

For both children and adult

An effective and affordable solution to

improve attention level

alleviate ADD/ADHD symptoms

is in great need

Current Solution

Medication

ADHD medication sales is estimated to reach $17.5billion in the year 2020.

Current Solution

Medication

Side effect:

• Sleep problems• Decreased appetite• Delayed growth• Headaches and stomachaches

• Rebound (irritability when the medication wears off)• Tics• Moodiness and irritability

Current Solution

Behavior Therapy, including parent training

Behavior therapy is a treatment option that can help reduce these behaviors. It is often helpful to start behavior therapy as soon as a diagnosis is made.

Cons:

Behavior therapy can only deal with symptoms, but not as a treatment.

Current Solution

Neurofeedback Training

• In 2012, American Academy of Pediatrics lists Neurofeedback as “Level 1 Research- Best supported Interventions” for ADHD

• Since then, people has been more open and willingto accept neurofeedback training.

• Divided by consuming locations, neurofeedbacktraining can be categorized into institute-basedtraining and home-based training.

Hospitals and Institutes

High expense:

$2000-6000/session, most insurance not covered plus

2-3 sessions needed plus

$150-200 first consulting fee plus

$ 195-250 brain mapping fee

Inconvenient: has to be on premises

Time Consuming

Not Engaging

Home-based Solutions

Normally includes a combination of EEG device andneurofeedback training software.

Price: $400-19,995

Key Players:

NeurOptimal System – has solid silver electrodes, pause thevideo or music if distracted, on computers

Versus – works with Muse and a app, has games on tablets

Neuro+ - works with Muse/Emotiv, measures focus level,stillness and motion responses in a game, on computers

Freedom 7D/Freedom 24 D – FDA-clearance, on computers

Home-based Solutions

Cons:

• Effect not guaranteed

• High price (some)

• Not engaging

• Cannot track improvements (some)

• Not convenient, a computer required

Direct Competitors

Price

Neurofeedback Related Professional NeurOptimal

Versus

Neuro+

ACTIVATE™Home

Freedom 7D

BrainBeat

David Alert

Direct Competitors

Insights

• A niche market indicating professional andneurofeedback at the price of $200-1000

• Few competitors can be used on multi digital platform

• The more professional, the less intriguing

• Only a few featuring the improvement tracking function

• Can only play alone

• Integrated using experience is important, includingmusic, visualization, touch or other motions

Target Audience

Children diagnosed with ADHD

Age: 4-17, mainly 7-11

Adults ADHD Patients

Age: 18+

Target Audience –Children

More severe in hyperactive symptomsHard to sit still. There are too many things attracting them at the same time

Children with ADHD can also focus, but cannot control their focus

Experience a hard time in building confidence and making friends对

Don’t want to be treated differently due to ADHD

Be pushed to take pills and take training instead of do them at will

Children are users and care about the fun factor. Parents are the purchasers and care about efficacy

Strong needs from parents and the school to correct their behavior

Target Audience –Adult

More ADD than ADHD

Some of them have very successful careers

Complain about the negative effect on career: amnesia, lack of confidence, low efficiency

Complain about daily life: quarrels between couples due to amnesia, irritability, impatience for listening

Care more about efficacy and being scientific while less about the fun factor

Target those who are taking medication, supportive events or nothing

Target Audience

The Choice of Target Audience

Since the needs of children and adults are different, it’s hard to attract both groups with a single product.

Recommendation:

Children first, and adults later.

BIG IDEA

We believe that children with ADHD should study,play and make friends like other normal children.Focus 1 can provide a game that children could playtogether and enjoy regardless whether they haveADHD or not.

Key word:

Fun, Share, Concentrate

Marketing Strategy

Product

Price

Promotion

Place

Market Strategy - Product

Design

Colorful, Cool, Potential to make customized stickers

Feature

Share, Fun, Challenging, Visualize and track improvement

Game Settings

Can stand and play in the beginning, integrated nodding, clapping, concentration and other motions to play games, andemphasizing concentration and sit still gradually.

3D Experience

With bulb first, and potentially lightsaber and other toys

Function

To avoid competing with neurofeedback training therapists and partner with them, our product can be the homework of a training. It can collect data on trainings and attention levels for therapists, so that they can better know their patientsand help them.

Market Strategy - Price

Recommended Retail Price: $300+

Price for School or Nonprofit Organizations：30-40%off

Zengar: Neuroptimal System $5,500

SenseLabs: Versus $499-749 for headset + $250for two-year subscription ofthe app

NeuroSpire: Neuro+ $299 for a MUSE headset +$30/month for the software

BrainMaster Technologies: Freedom 7D/ Freedom 24D $6995-19995

C8 science: ACTIVATETM Home Program $195-495

MINDALIVE: DAVID ALERT $395-465

BrainBeat Training Program $249

Market Strategy - Promotion

Children

School – free gift/Workshops to share educational info

Showcase in museum of science and kids event

Nonprofit Organization – events

Behavior Therapist – integrate the neurofeedback training in their training program

Game Contest/Meetup

Parents

Supportive events

Seminars – give speech to gain credibility

Regular events – share related knowledge and invite specialist for workshops or events

Market Strategy - Place

Media Channel

• ADHD Related Media: ADDitude, social media hot accounts

• Mass Media: Boston Globe, Boston.com,etc.

Distribution:

• Our website, events

• Neurofeedback Training Centers

• When we have several products: physical stores to let people experience our product

Collaborator:

• Actively reach out toy makers to explore other accessory products

• Keep good relationships with NPOs and schools

Possible Barriers and Recommendation

Combine IMU into the product

Signal Identification for blinking, nodding and knocking on the headband

Biggest Barrier ---- Game Development

Schools may not allow us to contact children directly ---- We may provide educational information and share knowledge of brain science and neurofeedback training with children. Free samples can be used